15 EU-Palestinian Co-operation
| (26934)
13521/05
COM(05) 458
| Commission Communication: "EU-Palestinian cooperation beyond disengagement — towards a two-state solution"
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| Legal base | — |
| Document originated | 5 October 2005
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| Deposited in Parliament | 21 October 2005
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| Department | Foreign and Commonwealth Office
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| Basis of consideration | EM of 25 October 2005
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| Previous Committee Report | None
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| To be discussed in Council | 7 November 2005 General Affairs and External Relations Council
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Background
15.1 The key elements of the international consensus on what a
negotiated settlement of the Israel/Palestine conflict might look
like build on Crown Prince Abdullah's initiative, adopted by the
Arab League in Beirut on 28 March 2002, which offers full normalisation
of relations between the Arab States and Israel, in the context
of a final settlement. They include an end to occupation, the
exchange of "land for peace" leading to a viable state
of Palestine alongside the State of Israel, both secure and respected
within recognised borders, as set out in UN Security Council Resolutions
242, 338 and 1397.
15.2 The path towards a renewed political process
is through the Quartet (US, UN, EU, and Russia) Roadmap, a performance
based plan leading to a final and comprehensive settlement to
the conflict. The situation on the ground, however, has not been
conducive to the Roadmap timetable, which envisaged completion
by the end of 2005. But the successful conclusion of the Israeli
disengagement from Gaza and parts of the northern West Bank on
15 September 2005 has given the process renewed impetus.
15.3 In anticipation of this, and recognising that
the Palestinian Authority (PA) would need considerable support
post-disengagement, the G8 meeting at Gleneagles in July 2005
welcomed and endorsed the approach presented by World Bank President
James Wolfensohn, as the Quartet's Special Envoy for Disengagement,
to support economic regeneration and further Palestinian governance
reform. The G8 Declaration supported his intention to stimulate
a global financial contribution of up to $3bn per year over the
coming three years. It called on domestic and international investors
to be full partners to this process; pledged its own practical
support for Mr Wolfensohn's efforts and looked forward to further
development of his plans and their presentation to the Quartet
and the international community in September; noted "the
strong interest of Arab States and members of the Organisation
of the Islamic Conference"; and encouraged them "to
provide substantial additional support".
The Commission Communication
15.4 As well as being a member of the Quartet, the
EU is currently the biggest donor to the Palestinians, providing
around €500 million each year, over half of which comes from
the EC budget and the remainder from bilateral EU Member State
funding. The priorities set out in this Communication are based
on the priorities of Mr Wolfensohn. The Commission's proposals
are helpfully summarised in his 25 October 2005 Explanatory Memorandum
by the Minister of State for Europe in the Foreign and Commonwealth
Office (Mr Douglas Alexander):
"The Special Envoy has presented six points
or joint issues for the Israelis and the Palestinians to address
in order to ensure the success of the disengagement plan and future
engagement of the international donor community. These cover questions
relating to border crossings, the West Bank/Gaza link, air and
seaports, houses in the settlements, and the greenhouses in the
settlements. In the context of agreements between Israel and
the Palestinian Authority on these points, the Commission is making
available support for customs operations at the border, and has
provided resources for infrastructure which could be used for
the sea or air ports.
"Looking beyond the disengagement period,
the Quartet Envoy has also presented three priorities on which
the Palestinian Authority should focus: fiscal stabilisation,
a medium-term development plan and job creation. The Commission
is addressing these priorities through its contribution to the
World Bank Public Financial Management Trust Fund, as this multilateral
channel has proved to be the most efficient system in the current
circumstances, as well as making available resources for quick-start
projects.
Priorities for EU support
"As identified in the Commission Communication,
the main institution-building priorities are already set out in
the EU-Palestinian Authority European Neighbourhood Policy (ENP)
Action Plan. This pays particular attention to establishing a
functioning judiciary, effective enforcement of legislation and
strengthening the rule of law; strengthening institutions and
reinforcing administrative capacity and building on the progress
already made in establishing an accountable system of public finances.
These agreed priorities provide guidance for the Commission's
financial assistance programme to the Palestinians.
"The Commission Communication identifies
that a key issue for the development of Palestinian authority
is the question of political and economic viability of the future
state, with economic and political dimensions interlinked and
inseparable. Political viability requires the strengthening of
democratic institutions, proper control of the security situation,
accountability, and the rule of law, respect for human rights
and fundamental freedoms and a thriving civil society. Economic
viability depends to a large extent on access to and from Gaza
and the West Bank, movement within the West Bank, territorial
contiguity and economic interaction with Israel. The Commission
proposes action in the following areas:
- Reinforcing legitimacy and accountability: Support
to the electoral process
Strengthening the rule of law: Assist Palestinian
reform efforts in the judiciary; develop short-term strategy for
consolidating the rule of law including the fight against corruption
and organised crime
Promoting respect for human rights and fundamental
freedoms: Continue to address the issue of incitement in political
dialogue with the PA, support civil society initiatives for human
rights
Improving security: Complement EU Special Representative's
work on transformation of civil police
Engaging civil society: Promote civil society
initiatives in support of the Middle East Peace Process
Making public administration more effective:
Support Palestinian public administration reform efforts, including
twinning
Jerusalem: Develop a strategy of assistance for
East Jerusalem
Addressing the refugee issue beyond immediate
humanitarian needs: Contribution to discussion on the future role
of the United Nations Relief and Works Agency (UNRWA) for Palestine
Refugees in the Near East
- Developing bilateral and regional trade relations:
Improve market access for Palestinian products; provide technical
assistance; facilitate dialogue to overcome administrative and
regulatory obstacles; develop scenarios for economic arrangements
with Israel; and encourage integration of the Palestinian economy
in the region
Building up a customs administration: Provide
support to customs administration; consider seconding experts;
offer to provide third party presence
Reconstructing and rehabilitating the West Bank
and Gaza Strip: Provide funds for quick-start infrastructure projects;
promote a renewed inflow of investment
Creating the enabling environment for private
sector investment: Assist Palestinian efforts to review legal
framework
Supporting the private sector: Work with the
European Investment Bank (EIB) to combine loan and grant resources
for private sector investment; provide assistance and training
to SMEs to improve management capacity and performance
Improving the management of public finances:
Support Palestinian efforts to modernise revenue administration;
provide assistance for further development of financial control
Developing a knowledge-based economy: Examine
options for support to rollout of broadband applications
Addressing the social dimension: Contribute to
social welfare programmes, in particular the World Bank's Social
Safety net reform programme.
Facilitating Israeli-Palestinian Cooperation
"The Commission aims to establish a programme
for energy cooperation with a view to enhancing joint security
for energy supplies. In this context a joint energy office will
be established and a commercial agreement should be reached dealing
with electricity exchanges between both parties in compliance
with international standards. A joint transport office is also
in the process of being established between the parties covering
transport infrastructure planning and the facilitation of transport
of goods and persons.
"The Commission hopes for similar progress
on trade issues. Such efforts should continue and be expanded
to cover areas such as customs cooperation, environment, science
and technology and as appropriate, issues relating to justice
and home affairs. Use should also be made of the possibilities
for regional cooperation in the context of the European Neighbourhood
Policy between the PA, Israel and Jordan.
"As progress is made on Final Status issues,
the Communication calls for the EU to be ready to commence negotiations
on a full Association Agreement. In the interim, the Commission
recommends consultation with both Israel and the PA to develop
the EC Interim Association Agreement with the PLO (for the benefit
of the Palestinian Authority) and to implement it more effectively.
The EU should also continue to press for full recognition of
the Interim Association Agreement by Israel.
Improving EU Effectiveness and Viability
"The Commission Communication calls for
efforts and activities of the EU to be more visible, to strengthen
political and reform messages. The Union should step up its efforts
to present its messages in a co-ordinated manner.
"In order to coordinate Member States and
Community resources more closely in support of the main policy
objectives of the EU the Commission Communication calls for the
establishment of a local Clearing House mechanism. It is hoped
this will improve the effectiveness and visibility of EU assistance.
This should include a regular flow of information on Community
and bilateral plans and projects, facilitating planning and burden-sharing
according to the specialist capacity of Member States and the
Commission."
The Government's view
15.5 The Minister says that the Communication
"is broadly in line with HMG thinking. Its
recommendations correspond with the areas the Government believes
the EU will be able to add value to Palestinian regeneration post-disengagement.
The emphasis put on protecting the status of East Jerusalem, as
well as the work co-ordinating a rule of law strategy with the
Reform Support Group, is in line with HMG's approach. The proposal
to increase EC funding by between €200 to €300 million
a year is welcome, so long as the Commission draws up a clear
plan for appropriate use of these funds and an assessment of their
viability in the context of developments on the ground.
"HMG supports, in principle, the creation
of an EU Agency for Reconstruction. But we would not commit to
this in the absence of a detailed proposal. The success of similar
projects such as the EU Agency for Reconstruction in Kosovo, and
the current difficulties in securing effective donor co-ordination,
suggest that a new mechanism could play a useful role."
15.6 In commenting on the Financial Implications,
the Minister says that the doubling of the international effort
proposed by Mr Wolfensohn "will only be possible as a joint
effort, with significant burden sharing, in particular on the
part of the Arab states". The increase in support from the
Community Budget of about €200-€300 million per year
would need to be accompanied by an increase in Member State bilateral
assistance. These resources would be targeted on the priorities
set out in this paper, "addressing the objectives of fiscal
sustainability, strengthening institutions and an improvement
of the economic situation through increased investment".
But "for these significant additional resources to have
an impact on the economic situation in the West Bank and Gaza,
meaningful progress in security and access policy needs to be
achieved". The Commission will come back with further details
on proposals for additional resources in the 2006 budget by early
2006 at the latest, taking into account progress on the Quartet
Envoy's six point plan, more detailed plans from the Palestinians
and "further consultations with the international community".
15.7 On the Timetable, the Minister says that,
having been approved by the College of Commissioners on 5 October
2005, the Communication will next be discussed by EU Foreign Ministers
at the 7 November General Affairs and External Relations Council,
which is expected to endorse the objectives and priorities set
out in this Communication as the basis of European Community action.
Conclusion
15.8 We share the Minister's broad endorsement
of the Commission's plans, and the essential caveats. The Commission
correctly underlines the inextricable linkage between economic
and political progress; so too the Minister, when he says that
"meaningful progress in security and access policy needs
to be achieved" for this additional support to have the desired
impact. Plainly, as with the Roadmap itself, whether the Commission
will be able to put forward detailed proposals in some months'
time will depend utterly on developments on the ground. It goes
without saying that we hope that, when we come to scrutinise any
detailed proposals, it will be sooner rather than later, and because
this partial disengagement has engendered the right response,
including from the rest of the international community, and not
renewed violence.
15.9 We now clear the document.
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